The fi­nan­cial-aid log­jam in higher ed­u­ca­tion can be re­solved by bet­ter man­age­ment. But grow­ing the econ­omy to make the pol­icy af­ford­able is go­ing to be far more dif­fi­cult

Financial Mail - - FEATURE - Claire Bis­seker bis­sek­ Sizwe Nx­as­ana

The res­ig­na­tion of cor­po­rate heavy­weight Sizwe Nx­as­ana as chair of the Na­tional Stu­dent Fi­nan­cial Aid Scheme (NSFAS) and the gov­ern­ment de­ci­sion to place it un­der ad­min­is­tra­tion is a text­book case of how not to man­age pol­icy change.

For­mer pres­i­dent Ja­cob Zuma’s an­nounce­ment on De­cem­ber 16 that higher ed­u­ca­tion would, from 2018, be free for all qual­i­fy­ing poor stu­dents came like a bolt from the blue.

With just weeks to go be­fore the start of the aca­demic year, NSFAS had to gear up to han­dle a del­uge of ap­pli­ca­tions, which surged to more than 600,000 against the usual 400,000. And then it had to wait un­til April to get the re­quired fund­ing.

It would have been a tall or­der for an ef­fi­cient, re­spected in­sti­tu­tion to man­age the sit­u­a­tion — but NSFAS was nei­ther.

Op­er­a­tionally, it had a new CEO in Steven Zwane. He was still bed­ding down the change, made in 2016, from a sys­tem in which the 26 univer­si­ties ad­min­is­tered their own fi­nan­cial aid to one that cen­tralised ev­ery­thing un­der NSFAS.

For­mer Univer­sity of the Free State rec­tor Jonathan Jansen de­scribes NSFAS as “a mon­stros­ity”, be­set by on­go­ing in­ef­fi­cien­cies and lack­ing cred­i­bil­ity, hav­ing amassed R20bn in outstanding loan re­pay­ments over many years.

Given NSFAS’S lack of ca­pac­ity and cred­i­bil­ity, it was a “mas­sive blun­der” to cen­tralise all fi­nan­cial aid un­der its con­trol in 2016, says Jansen. “To think it could take the whole

R21bn [free-fees sys­tem] on its own shoul­ders was mad­ness.”

Nx­as­ana, a for­mer Firstrand CEO, thinks NSFAS “ac­tu­ally did quite well un­der the cir­cum­stances”, bear­ing in mind it was ad­min­is­ter­ing two sys­tems at once: a loan-re­cov­ery sys­tem for for­mer stu­dents, and a bur­sary or grant sys­tem for new, fee-free stu­dents.

NSFAS says it has pro­cessed more than 600,000 ap­pli­ca­tions and ap­proved aid for 478,580 new and re­turn­ing stu­dents who meet the cri­te­ria. Roughly 370,000 of th­ese ap­proved stu­dents have been paid out, but the long de­lays in dis­burs­ing stu­dent al­lowances have given rise to horror sto­ries about stu­dents go­ing hun­gry, be­ing forced to live in squalor and fac­ing evic­tion.

Ac­cord­ing to Nx­as­ana, the pay­ment back­log mainly con­cerns stu­dents who have failed to sign their new NSFAS bur­sary agreements.

The bur­sary agreements, which re­place the pre­vi­ous NSFAS loan agreements, are a source of much un­hap­pi­ness. Some stu­dents have balked at the fact that the no-strings prom­ise of free ed­u­ca­tion has been re­duced to a bur­sary, com­plete with terms and con­di­tions and, in some cases, stricter per­for­mance re­quire­ments than be­fore.

For in­stance, un­der the old agree­ment stu­dents could con­tinue to qual­ify for NSFAS fund­ing if they com­pleted their univer­sity de­grees within the reg­u­lated time plus two years (N+2). This has been re­duced to N+1 be­cause the new pack­age is much more gen­er­ous, cov­er­ing al­most the full cost of fund­ing, in­clud­ing books, ma­te­ri­als, trans­port, ac­com­mo­da­tion and fees.

Part of the de­lay in pay­ing stu­dents their al­lowances was caused by the ab­sence of any pol­icy de­tail in Zuma’s De­cem­ber 16 an­nounce­ment. It took un­til mid-may for the gov­ern­ment to de­cide on, cost and ap­prove the terms of the new pack­age.

Var­i­ous stake­hold­ers were in­volved. For in­stance, univer­si­ties had to de­velop bench­marks for on-cam­pus or univer­sity-ac­cred­ited ac­com­mo­da­tion; NSFAS had to de­velop bench­marks for meals; the depart­ment of higher ed­u­ca­tion & train­ing had to de­velop travel bench­marks; and all th­ese bench­marks, which were fun­da­men­tally dif­fer­ent from the pre­vi­ous pol­icy, had to be costed by the Na­tional Trea­sury.

“This was clearly a text­book case of how not to man­age pol­icy change,” says for­mer Univer­sity of Jo­han­nes­burg vice-chan­cel­lor Ihron Rens­burg. “[The an­nounce­ment of feefree ed­u­ca­tion] was clearly a des­per­ate po­lit­i­cal act by Ja­cob Zuma de­void of any un­der­stand­ing of the com­plex­ity of im­ple­ment­ing and fund­ing that pol­icy.”

If the gov­ern­ment learns any­thing from the de­ba­cle, it should be that pre­cip­i­tous pol­icy changes should not be an­nounced un­less crit­i­cal in­sti­tu­tions have the fund­ing and ca­pac­ity to im­ple­ment them.

But in­stead of blaming the gov­ern­ment for mis­han­dling the is­sue, NSFAS has borne the brunt of stu­dents’ anger, lead­ing to good peo­ple like Nx­as­ana be­ing pil­lo­ried.

Last week, stu­dent or­gan­i­sa­tions warned of more na­tional protests at higher ed­u­ca­tion in­sti­tu­tions, while the Na­tional Ed­u­ca­tion, Health & Al­lied Work­ers’ Union re­peated its de­mand that Zwane step down.

“It is ut­terly un­fair of stu­dents and unions to dis­miss NSFAS as a failed or­gan­i­sa­tion, given the con­text,” says Rens­burg.

Bd/rus­sell Roberts

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